Arkansas earns ‘F’ for judicial financial disclosure

12:01 am, December 4, 2013Updated: 12:19 pm, May 19, 2014

The Center for Public Integrity evaluated the disclosure rules for
judges in the highest state courts nationwide. The level of disclosure in
the 50 states and the District of Columbia was poor, with 43 receiving failing grades,
making it difficult for the public to identify potential conflicts of interest
on the bench. Despite the lack of information in the public records, the
Center’s investigation found nearly three dozen conflicts,
questionable gifts and entanglements among top judges around the country.
Here’s what the Center found in Arkansas:

Strengths:

Bolstered by strong accountability and accessibility, Arkansas came very
close to earning a passing grade for its financial disclosure requirements
for its highest court. Arkansas’ financial disclosures are posted online
for public inspection by the secretary of state’s office. Judges must disclose
the source and exact value of any gifts they, their spouse and dependent
children receive. (Gifts received by judges and their spouses must be reported
if their value exceeds $100; the reporting threshold for gifts received
by dependent children is $250.) They must also provide a description of
the gift.

Weaknesses:

When it comes to investments, judges report values in broad categories:
between $1,000 and $12,500 and more than $12,500. Income is reported the
same way. Judges, as well as other state officials, do not have to report
investment transactions or income generated from each investment. Additionally,
the state requires little disclosure of judges’ liabilities. Only the names
and addresses of creditors who are owed more than $5,000 need be reported.
No information about the type of debt or the amount owed is required.

Highlights:

In April 2012, Justice Paul Danielson wrote the court's
opinion
in a case involving XTO Energy, a subsidiary of Exxon Mobil
Corp. Plaintiffs Kenny, Shelia and Kendell Lee Staggs argued that XTO Energy
and two other companies wrongly claimed oil and gas rights to property
on which the Staggs family owned the rights. An Arkansas circuit court
granted summary judgment, ruling in favor of XTO Energy based on a deed
executed in 1934. The Supreme Court affirmed the lower court’s decision.
The same year Danielson wrote the court’s opinion in favor of XTO Energy
and the other companies, the justice reported his wife earned between $1,001
and $12,499 in income from the natural-gas company. He reported the same
range of income from XTO Energy in 2011, as well.

In an interview, Danielson said his wife earned the XTO Energy income
in the form of oil and gas royalties tied to land she inherited from her
family. He said he was aware of the royalty payments when the Staggs case
reached the Supreme Court, but he didn’t recuse himself because “it certainly
wasn’t going to affect my decision.” To Danielson, his family’s XTO income
is insignificant. “If I had Wal-Mart stock worth $100,000, I’d get off
a Wal-Mart case,” he said.

“But I won’t get off a case for silly reasons. These are just calls we
have to make as judges,” Danielson continued. “I have a bigger problem
with judges being too quick to recuse.” Danielson said he was “elected
to decide cases,” not sit them out. Especially cases involving oil and
gas litigation. “One of my specialties is oil and gas [litigation],” he
said. “If I had to get off of every oil and gas case, it wouldn’t be good
for the court.” In fact, Danielson added, “it would do more harm than good.”

In 2012, Justice Courtney Goodson accepted a $50,000 trip to Italy from
Arkansas attorney W.H. Taylor, according to Goodson’s financial disclosure.
It wasn’t the first time she vacationed on the lawyer’s dime. The year
before, according to her 2011 financial disclosure, Taylor paid for Goodson’s
$12,000 “Caribbean Cruise.” The two trips raised eyebrows after they were
revealed in Arkansas news
reports
earlier this year. Taylor’s clients include John Tyson, the
chairman of Tyson Foods, Inc., a food-processing giant based in Arkansas.
“As Justice Goodson has previously stated, she will continue to recuse
in cases involving her personal lawyer, W.H. Taylor; and out of an abundance
of caution, she will continue to recuse in cases involving Tyson,” court
spokeswoman Stephanie Harris wrote in an email to the Center on behalf
of the judge.